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Fact Base

Products & Supply Chain

4.1 Product Responsibility

    Dialog with Customers

    Responsible Marketing

    Corporate Marketing and our Code of Conduct, which every Voith employee abides by, ensure Voith products are presented to customers truthfully and transparently. The actions of each and every Voith employee are bound by the unwavering principle that information should be presented fairly and truthfully. We provide regular instruction on the scope of our Code of Conduct through online training sessions (including compliance training sessions) and in employee appraisals.

    Moreover, Voith Paper’s marketing approach ensures that technically complex solutions are presented by select experts from our R&D centers (York, Heidenheim, Västeras, Shanghai), and discussed with customers. If necessary, the marketing activity is supported by the Group Division’s, or even the holding’s, top management team. Internal coordination meetings ensure that global knowledge is bundled in relevant projects.

    Research & Development

    Research & Development Expenditure

    Research & Development expenditure

    GRI

    in € million

    FY 2015/16

     FY 2014/15

     FY 2013/14

     

    R&D Expenditure

    208

    210

    216

    in %

     

     

     

    Percentage of Revenues Dedicated to R&D

    4.9 %

     4.9 %

     5.2 %

    Collaborations Deliver Key Findings on Future Viability

    Voith Paper Collaborative Projects

    Since its launch in 2015, Voith Paper has been involved in the industry-wide “Fibres & Paper 2030 – Shaping a Sustainable Future” project, which is coordinated by the German paper-technology foundation PTS. During the project’s 15-month timeframe, a scenario analysis was produced which addressed future business fields and customer requirements for fiber-based materials.

    Furthermore, Voith Paper, together with some 30 other paper-industry customers and suppliers, is part of a pre-competitive cluster being developed by the CEPI (Confederation of European Paper Industries). The project centers around the use of DES (deep eutectic solvents), which are used to dissolve fibrous materials to produce pulp with minimal energy, emissions, and residues. In accordance with the CEPI roadmap, the aim is to achieve an 80% reduction in CO2 emissions and increase value in the sector by 50%.

    Additionally, Voith Paper is one of the initiators of the pan-EU Provide project. It aims to achieve a dramatic reduction in the carbon footprint in terms of the use of wood, particularly in the production of cellulose and paper. Together with several universities and research institutes, the consortium of almost 20 industry partners is researching a radically new process to separate wood, and in doing so to produce cellulose, hemicellulose, and lignin with low CO2 emissions. It is also researching ways to process used paper in a more environmentally friendly manner. The project runs until summer 2018.

    In the 2015/16 fiscal year, as part of the recently launched Kopernikus program, Voith made its own application under the SynErgie consortium, the scope of which was approved as planned. The project was launched on September 1, 2016 [Link in German only].

    Voith Hydro Collaborative Projects

    Voith Hydro is one of nine industry and science partners involved in the Hyperbole research project. It is funded by the European Union, and is investigating ways to enhance the operating range of Francis and pump turbines. The aim is to improve the integration of renewable energy sources into the grid through the more flexible operation of hydropower plants.

    Furthermore, Voith Hydro is also collaborating with the Leibniz University of Hanover, Germany, on the further development of hydroelectric power generators.

    Reliable and Safe Products

    Quality Management in Our Business Areas

    GRI  
    G4-DMA (Customer Health and Safety); G4-PR1 Through its internal management system, Voith Hydro ensures that quality standards and certificates are uniform for all units globally. All of Voith Hydro’s locations are certified according to the ISO 9001 international quality management standard. Regardless of the operating location, the European standard applies at all times as the minimum standard for machine and plant safety. Through active product monitoring of the installed machines, Voith Hydro also ensures that new findings gained from operation are incorporated into machine optimization.

    With its EPEX (Excellence in Project Execution) project, since the 2014/15 fiscal year Voith Hydro has aimed to achieve excellence in executing projects. EPEX focuses on process and product standardization as well as on strengthening customer focus.

    As KPIs Voith Hydro uses our internal GPS Standards for turbines & generators and their auxiliary systems, which we developed internally and which are based on our own extensive experience as well as harmonized standards.

    In the reporting year the Owner Quality module was established as part of the project. All internal and external inspection and test plans have been revised, and now reflect current market requirements.

    Moreover, several major successes have been achieved during project implementation in the reporting period. Among them, many pilot projects are already up and running according to the new standards. Furthermore, numerous employees have been trained using the train-the-trainer model.

    In addition, as part of the continual development of Voith Hydro’s quality management system, a special fault-classification code was developed and implemented in the SAP fault documentation system in the reporting year. Now, according to the Pareto principle, fault clusters can be calculated and displayed at the press of a button. On the basis of this, the various functional units in the company are now regularly asked to initiate targeted improvement measures.

    Voith Paper sees quality as a key differentiator that distinguishes it from the competition, and has anchored the subject in the top management level. The fundamentals of the Voith Paper quality management system are set out in Group Directives, process descriptions, and work instructions. Necessary reviews and corresponding documentation are controlled mainly via the internal ERP (enterprise resource planning) systems. Potential health, safety, and environment impacts are taken fully into consideration. To continuously improve the processes, Voith Paper uses various tools such as Ishikawa, FMEA (Failure Mode Effect Analysis), and 8D reports.

    KPIs in the area of quality at Voith Paper include quality costs, based on the German DIN 55350 standard, which also serve as the basis for recognized benchmarks. They are complemented by internal and external fault analyses. The operational excellence results are recorded and evaluated in an Excellence database. The development of results has been positive on the whole since the project started in the 2014/15 fiscal year.

    Internal Voith standards exist for the design of safety equipment. Risk assessments are performed routinely, whose results are taken into consideration during the product development process. Special regional aspects are taken into account by the Voith Paper Quality Order Manager organization, and allowed for when implementing the contract.

    In the reporting period, one of the focus areas for Voith Paper was the further roll-out of its Modular Key Component project, which targets the consistent improvement of product quality. Under this project, paper machine components are harmonized irrespective of the paper grades to be produced, resulting in a reduction in mechanical engineering variance. This way, components can be used more universally and can be better combined, resulting in a drop in the error rate and an increase in quality. The other area Voith Paper focused on in the reporting period was the production and material quality of suppliers’ products, which always need to meet the same high standards we expect of our own products.

    Voith Turbo maintains a uniform and comprehensive quality management system, which is also certified to ISO 9001. All employees are trained on quality issues and consistently implement this system. Several quality programs are currently running at Voith Turbo to increase the reliability of its products even further. At the same time, Voith Turbo seeks a close relationship with customers to allow their experience of daily system operation to be incorporated into further product development.

    In the reporting period, the existing Quality departments were consolidated within the CTO organization. The idea behind this is to achieve global harmonization and standardization, allowing for individual industry and customer requirements. The three main certification activities are now taken care of by a single point; this also ensures that the shared document control system is used uniformly and efficiently. The various methods to ensure quality, such as Six Sigma, 8D, and FMEA, are also bundled in a dedicated unit for the entire Group Division. The holding and evaluation of customer satisfaction surveys, the corresponding internal lessons learned, and the handling of customer complaints are also coordinated centrally. Last but not least, attention is paid to ensure that quality assurance processes are efficient around the world, and that regulatory and legal requirements on future products are met.

    The new organization at Voith Turbo also ensures that the relevant experts in the field of quality are involved early on in innovation processes. Among other things, this ensures that material quality and/or compliance regulations are respected. In doing so, we generally follow the principle of only promising what we can deliver – on time, in high quality, and to the agreed specification.

     GRI  
     

    Voith Hydro is faced with a particular challenge, as the long operating life of hydroelectric power plants requires several generations of employees to be trained on existing technology to ensure optimal operation and maintenance of the plants. The Voith HydroSchool takes these requirements into account through targeted training courses.

    4.1.2 Our Products’ Environmental and Social Impacts

      Product Impacts by Group Division

      Voith Paper

      Progress Regarding Social and Environmental Impacts

       GRI  
      G4-EN27

      23 of the 34 new products launched are noteworthy for consuming fewer resources.

      For instance, the InfiltraDiscfilter (IDF) disc filter when used in a SaveAll application considerably reduces water consumption. Thanks to the wear-free construction of the filter segments, fibers can be maintained efficiently in the process, and the circulation water can be reused in a huge variety of ways. Furthermore, less organic sludge accumulates in the water treatment plants.

      The following three products offer energy savings of between 10 and 30%:

      • The EvoDry drying cylinder, made from high-strength steel, increases heat transfer by 7% compared to conventional cast iron cylinders. This not only brings benefits in terms of energy consumption – it also reduces construction costs thanks to its smaller footprint (shorter oberall length) and places up to 30% less weight on the sole plates.
      • The new InduraClean solution requires around 20% less electricity to deliver the same filtration efficiency and production throughput.
      • The new The Wall disperser filling offers a higher service life alongside a 30% energy saving. And the new PeakElement felt dewatering fabric helps reduce thermal energy by over 10%.

      In the reporting period Voith Paper also developed a new steam-heated hood for tissue production. It is highly beneficial in regions where gas is unavailable as a fuel or where excess steam can be utilized from other production processes. Three of these hoods, which also greatly reduce the risk of fire, are already being used successfully by customers.

      Another new product for the tissue market is the TissueLev unit, which increases dryness, reduces thermal energy consumption, and increases both production safety and efficiency. In the reporting period the product was tested successfully in the market, with the product launch planned for the current fiscal year.

      Furthermore, the following Voith Paper products are helping to conserve resources:

      • The new MasterJet headbox with IntegraDamp reduces energy loss compared to the previous generation of technology.
      • HydroSeal technology brings sealing-water savings and reduces the amount of drive energy required.
      • CleanWeave dryer fabrics offer improved cleaning efficiency with constant dryer-section drying performance.
      • The HHT coating for Yankee cylinders delivers energy savings with improved heat transfer.       
       GRI  

      G4-DMA (Products and Services); G4-EN27

      The loss of large amounts of graphic paper such as newspapers and magazines means that fewer fibers, which are often only used once, are introduced into the recycling loop. In turn, this reduces the strength potential of the used-paper mix. This relationship represents a specific challenge for Voith Paper, so it is working on new solutions to improve the strength potential of fibers before further processing. It is an important contribution to maintaining the recycling loop.

      As a specific example of this, in felt production pure polyamide fibers are reused as standard in the production process. In the Business Line Fabric & Roll Systems, polyphenylene sulfide (PPS) and used PPS fabric production waste is recycled and used to produce PPS yarns. The plastic is produced as a byproduct of dryer fabric production.

      At Voith, we use KPIs to depict and monitor the recycling rate: The percentage shares of recycled PPS yarn and recycled internal waste in relation to total waste represent two important KPIs in this regard.

       GRI  
       

      Voith Hydro takes noise reduction into consideration right from the system design stage. An Acoustics Officer at the central engineering department promotes developments in the field of noise reduction, with the corresponding soundproofing knowledge available globally to employees in the operating units. The aim is to expand the spectrum of technical solutions, and to publicize them even more widely. Power plant operator employees also benefit from these activities, especially as they are exposed to a lower noise level when performing maintenance work or inspection tours. Furthermore, this means the neighboring community does not notice the noise as much, thereby further increasing the acceptance of green electricity generation from hydropower.

      To examine and improve the generator soundproofing solution, Voith Hydro analyzed the noise generated by a hydropower generator as part of two large special measurements. To obtain insights on reducing turbine noise emissions, a load was introduced in the housing structure. Noise reduction was investigated computationally by increasing the turbines’ casing thickness. The vibration and sound radiation of an exposed penstock was analyzed using numerical calculation methods (FEM – finite element method) and initial measures evaluated.

       GRI  
       

      An ever-increasing number of projects globally are using Voith's environment and resource-friendly technologies. Among them, last year we installed the first of four Francis turbines at Brownlee Dam in Idaho. Similar turbines will also be used in coming years at the US Army Corps of Engineers’ Center Hill Dam, where they will increase the oxygen content of water flowing into the valley from 0 to 6 mg/liter.

      Furthermore, in the previous fiscal year a new turbine with fixed impeller blades was put into position at the Ice Harbor run-of-river hydropower plant in Washington State. Through modifications to the components, the conditions for fish swimming downstream is improved. Moreover, two variable blade turbines will also be installed at Ice Harbor which are also specially designed to aid the passage of fish.

      In the United Kingdom, in the reporting year Voith was commissioned to modernize the Mucomir small hydropower plant in Scotland, which has been in operation since 1962.

      Voith is taking care of the rebuild, installation, and commissioning of the plant’s turbine unit, the exchange of the digital controller and hydraulic power units, and the rehabilitation of the generator. The construction works are set to be completed by fall 2017.

      Once it has been modernized, the Mucomir small hydropower plant will meet high environmental standards. Thanks to the special design of the new turbine impeller, the negative impact on fish will be reduced, allowing them to pass through the turbine. The power plant operator, SSE, is thus taking into consideration regional fishing interests, and recognizing the significance of the plant for fish migration in the local fishing area.

      GRI  
       

      In the reporting period Voith Turbo developed an obsolescence management system, which identifies, manages, and controls the natural and artificial aging or non-availability of a product, not least from an innovation viewpoint. To give an example, Voith Turbo offers a system for use in buses that allows driveline monitoring over the entire lifecycle. The bus operator is informed automatically of any impending malfunctions, which in turn improves operational reliability and almost completely rules out spontaneous vehicle failures.

      4.2 Responsibility for Supply Chains

        High Procurement Volume, Heterogeneous Product Range

        Purchasing Volume

        Procured Production Materials by Value

        GRI

        in € million

        FY 2015/16 

        FY 2014/15 

        FY 2013/14

        G4-12

        Total purchasing volume production materials

        1 823

         1 830

        1 770

        Electricals/electronics

         173

         171

         156

        Cast parts

         138

         138

         141

        Subcontracting

         196

         149

         129

        Structural components

         280

         253

         247

        Steel/semifinished products

         53

         59

         51

        Welded structures

         85

         84

         78

        DIN/standard components

         60

         50

         46

        Roller bearings

         42

         38

         34

        Hydraulics

         39

         39

         37

        Forged metal parts

         39

         35

         31

        Active Suppliers

        Active Suppliers

        GRI

        Number

        FY 2015/16 

        FY 2014/15 

        FY 2013/14

        G4-12

        Total

        23 159

        21 543

        22 555

        of which new suppliers

        n.d.

        n.d.

         n.d.

        of which preferred suppliers

        n.d.

         n.d.

        n.d.

        Regional distribution in %

         

         

         

        Germany

        35.4

        33.9

        33.9

        Europe excluding Germany

         23.0

         21.6

        20.8

        Americas

         27.8

         28.3

        29.8

        Asia

         12.7

         14.8

         14.1

        Other

         1.1

         1.4

         1.4

        Procurement Markets

        Procurement Markets

        GRI

        Regional distribution of purchasing volume (in %) 

        FY 2015/16 

        FY 2014/15 

        FY 2013/14

        G4-12

        Germany

        38

        40

        42

        Europe excluding Germany

         23

         22

        21

        Americas

         23

         22

        27

        Asia

         15

         15

        10

        Other

         1

         1

        0

        in € million

         

         

         

        Purchasing volume

         2 479

         2 540

        2 473

        Number

         

         

         

        Different countries of origin for suppliers

        84

         84

         82

        Country-specific GPTs

        Country-specific GPTs

        GRI

        Number

        FY 2015/16 

        FY 2014/15 

        FY 2013/14

         

        Country-specific GPTs

        21

        21

        n.d.

        of which new

         none

         none

        n.d.

        of which updated

         none

        none

        n.d.

        Updating of GPTs in FY 2016/17.

         

         

         

        GRI  
         

        The EU has still not clearly defined its position on the US’s Dodd-Frank Act concerning the use of conflict minerals. In addition to a current amendment to EU legislation, it remains to be seen whether the US government, which has been in office since 2017, will revise or abolish the Dodd-Frank Act, as announced. To prepare in good time for the new regulations, in the 2013/14 fiscal year we established a working group consisting of representatives from Purchasing, the Legal Department, and the central function Corporate Sustainability. The aim is to record and evaluate all information centrally, including related customer inquiries, and prepare action recommendations for Voith.

        Scope of Training

        Training Purchasing Employees on the Scope of GPTs and/or Workers’ Rights and Supplier Working Conditions

        GRI

        Number

        FY 2015/16 

        FY 2014/15 

        FY 2013/14

         

        Purchasing employees globally

         520

        n.d.

        n.d.

        Trained Purchasing employees globally

         520

         n.d.

        n.d.

        Hours of training of Purchasing employees

         5 128

         n.d.

        n.d.

        Employees = persons according to Job Family model

        Supplier Self Assessment and Evaluation

        Supplier Self Assessment

        Suppliers Who Have Filled Out a Self Assessment

        GRI

        Number

        FY 2015/16

        FY 2014/15

        FY 2013/14

        G4-EN32; G4-LA14; G4-HR10; G4-SO9

        Initial self assessment

        2 430

        2 156

        1 400

        * When reviewing existing and new suppliers, Voith always takes their working practices into consideration. A separate evaluation of the percentage of new suppliers that have been evaluated is not available

        Supplier Evaluation

        Evaluations of Existing Suppliers

        GRI

        Number

        FY 2015/16 

        FY 2014/15 

        FY 2013/14

        G4-EN33; G4-LA15; G4-HR11; G4-SO10

        Evaluations (individual processes)

        2 441

         4 655

        6 386

        Suppliers evaluated

        1 956

         3 814

         4 890

        Suppliers audited

        k.A.

         k.A.

        k.A.

        in %

         

         

         

        Supplier Self Assessment ratio (share of the invoice volume obtained from suppliers
        for whom there is a valid self assessment)

        59.2

        61.7

        36.0

        Sustainability ratio

         85.4

         84.0

        74.0

        Share of invoice volume placed with evaluated suppliers

         68.0

         62.0

        71.0

        Invoice volume in € million

         

         

         

        Volume of invoices with suppliers for whom an up-to-date, approved supplier evaluation was available

         1 274

         947

        1 188

        Supplier Compliance

        Supplier Compliance

        GRI

        Number

        FY 2015/16 

        FY 2014/15 

        FY 2013/14

        G4-EN34; G4-LA16; G4-SO7; G4-SO11; G4-HR12; G4-PR2

         Reports regarding suppliers via the Compliance Helpdesk

        0

         0

         0

         of which reported violations against environmental standards

        0

         0

         0

         of which reporting violations against social standards

        0

         0

         0

        Blocked suppliers*

        10

        7

        1

         

        * Only in the context of the Blocked Supplier Concept (violations of compliance and/or sustainability guidelines), excluding bankruptcies and blocking owing to technical quality defects or export controls.

        Get in touch with us

          Sustainability

          Ulrich Weisse

          Voith GmbH & Co. KGaA

           

          Products & Supply Chain

          Voith GmbH & Co. KGaA

          Corporate Sustainability

           

          Employees

          Ilonka Nußbaumer

          Voith GmbH & Co. KGaA

           

          Corporate Citizenship

          Joerg Kondring

          Voith GmbH & Co. KGaA

           

          Hanns-Voith-Foundation

          Meinrad Schad

          Hanns Voith Foundation

           

          t Tel.: +49 7321 37-2227

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